Microsoft rethinks employee reviews … and towels

Microsoft plans to overhaul its performance-review system for employees and make a series of additional changes — including new perks on the Redmond campus — in an effort to address some of the biggest complaints from its work force. Microsoft HR chief Lisa Brummel announced the initiative, dubbed “myMicrosoft,” Thursday afternoon at an internal “town hall” employee meeting attended by CEO Steve Ballmer and others.

And yes, the company is restoring the discontinued towel service, a previous cutback that became a lightning rod for employee dissatisfaction and bemusement over Microsoft’s cost-cutting initiatives. That particular announcement today received an especially boisterous response during the meeting, according to people who were there. Among other things, the company will be expanding food service options on campus.

“To reset our approach, beginning with this review period we are retiring the 2.5-5.0 rating scale and introducing a three point Commitment Rating scale of Exceeded, Achieved and Underperformed. … There will be no forced distribution (i.e. curve) associated with this commitment rating, which allows managers and employees to have a more candid discussion about performance.”

“We are increasing our investment in our annual review stock award program. This incremental investment is focused on providing meaningful stock awards to our top talent. ‘Top talent’ refers to employees who are strong performers, achieve results in the right way and are expected to make the greatest future contributions.”

“We’re planning to provide on-campus access to a variety of services, including laundry and dry cleaning, grocery delivery from Safeway and opening convenience stores — all of which are designed to ease the burden given the hectic pace of life. We will expand and upgrade dining services adding great new retail food in select cafes, dinners to go from Wolfgang Puck and other services. We are also arranging discounts on a variety of home services including house keeping, yard care, pet care, auto services and more.”

And finally, a reality check: While Microsoft might compare employee perks to those at Google and others in the tech world, it’s worth noting that all of this seems a bit over-the-top and extravagant to some people at other companies. After previousstories on Microsoft employees protesting cutbacks, I received multiple calls from Boeing workers (some of them Microsoft shareholders) who couldn’t believe the perks the Microsoft employees had in the first place.